The Davy Digest - 24th November 2025

Global equities finished lower last week as concerns grew over the sustainability of spending on artificial intelligence and traders reevaluated the likelihood of a rate cut at the Federal Reserve’s December meeting. In equity markets, Nvidia’s third quarter earnings report was the headline event on Wednesday night, as the chipmaker surpassed Wall Street estimates for revenue and profits. Despite this, on Thursday, the S&P 500 experienced its largest intraday swing since Liberation Day, closing 1.6% lower. With the reopening of the US government, the flow of usual economic data resumed. On Thursday, we received September’s jobs report after a six-week delay. Although the US economy added more jobs than expected, the unemployment rate continued to rise, reaching 4.4%.

In Europe, purchasing managers’ indexes (PMI) surveys showed an improvement in business activity across the continent. While in France, Prime Minister Sébastien Lecornu failed yet again to pass his budget for 2026. Further afield, in Japan, inflation accelerated in October to 3.0% year-on-year, in line with consensus estimates.

Last week's highlights

	September Nonfarm Payrolls (20/11) – 119k jobs added during September, above consensus September Unemployment Rate (20/11) – Increased to 4.4% (vs 4.3% expected)
	German HCOB Manufacturing PMI (21/11) – Fell to 48.4 (vs 48.5 expected) Euro Area Consumer Confidence (20/11) – Remained at -14.2 (vs -14.0 expected)
	UK Inflation (19/11) – Slowed to 3.6% year-on-year (vs 3.5% expected)
	Japan Inflation (21/11) – Accelerated to 3.0% year-on-year, in line with consensus

This week, more delayed data will be released in the US, as September’s Producer Price Index inflation measure is published on Tuesday. In Europe, Germany’s Ifo Institute will release their collection of business surveys, providing a measure of business and consumer sentiment there. In the United Kingdom, the details of Rachel Reeves’ much-anticipated autumn budget will be released as she attempts to manage a stagnating economy while curtailing excess spending. In addition, the Office for Budget Responsibility will update their economic and fiscal projections. In Japan, industrial production figures and Tokyo inflation data will be released.

What's on the radar

	September Producer Price Index (25/11) Conference Board Consumer Confidence (25/11)
	German IFO Surveys (24/11)
	UK Budget (26/11)
	Tokyo Inflation (27/11) Japan Industrial Production (27/11) Brazil November Preliminary Inflation (26/11)

Chart of the moment - Deep learning, deeper pockets

Source: Bloomberg, November 21st 2025. MSCI USA Technology Index is used for US Technology figures. CapEx = Capital Expenditure. FCF = Free Cash Flow.

• The scale of capital expenditure (CapEx) by technology firms in the US has surged in recent years as companies race to enhance their AI-related capabilities.
• This spending has come under increasing scrutiny, with investors questioning whether its pace is excessive, drawing parallels to the dot-com bubble and the excess capacity that it left behind.
• Unlike the dot-com bubble, the current AI investment boom has so far been largely funded by cash rather than debt, reflecting companies with stronger balance sheets and better liquidity than in previous bubbles.
• Although CapEx has reached record highs in the US, it remains a much smaller proportion of firms’ free cash flow compared to previous periods.

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